Many young children in western societies become literate in a world that relies heavily on digital technology. However, in early childhood education, play-based learning is typically the focus of curriculum and increased digital engagement by young children has caused concern among parents, educators and other key stakeholders. These concerns emanate from a belief that other activities (e.g., reading) are more constructive for young children. The purpose of this study was to describe young children’s digital tool use and engagement in digital literacy activities in the context of family life before, and as they transitioned into, kindergarten. Drawing from sociocultural theory, this case study of young children and their parents focused on two families’ digital literacy events in the context of their home over one year. Observed digital literacy events were analyzed using “literacy as a social practice” (Barton & Hamilton, 2000) to frame the social situations in which the children were developing their digital literacy. The findings indicate that these children engaged in digital activities and non-digital activities in a balanced manner and that they were active meaning makers while engaged with digital technology. Children moved fluidly between digital and non-digital spaces during their play, particularly during narrative play. Parents mediated and supported their children’s uses of digital media; however, rules governed which devices and content children could access, and for what length of time. Parents’ mediation styles concerning digital media did not change as children transitioned into kindergarten; however, peers influenced the children’s digital interests once they entered kindergarten. Parents were not frequent users of digital media and did not characterize engagement with digital tools as play, which led to tensions for mothers about whether to permit their young children to use digital media. This study provides an example of how three children accessed and used digital tools at home before as they transitioned to, kindergarten. It adds to evidence that screens do not dominate children’s lives. Policy makers and practitioners can use the insights from this study to recognize the ways that children and parents use digital tools in their homes as they consider curriculum, pedagogy, and policy.